Labour's National Executive Committee has agreed that as the incumbent leader he will be on the ballot paper.
Meanwhile, deputy leader Tom Watson told a meeting of the parliamentary Labour Party (PLP) that his abandoned peace talks with union leaders failed to find a way around the impasse between MPs and pro-Corbyn elements of the party.
His opponents in the party, who want him gone as leader, had argued that under party rules he needed to be nominated by 51 Labour MPs and MEPs to stand again.
She said there should be no legal challenge to the NEC's decision but warned that Labour risks electoral wipeout in the north at the hands of Ukip, similar to that it has suffered in Scotland if Mr Corbyn remains leader.
"I'm in this contest to win it and that's what I intend to do". But others are equally as determined to stop him - nervous now that if he wins once more, that the Labour Party itself it might not survive.
Describing Mr McDonnell as "part of the problem", the former shadow work and pensions secretary said: "To John McDonnell I said I feared he had decided that people in his part of the party wanted to split the Labour Party and he shrugged his shoulders and said "If that's what it takes".
The outcome of the leadership contest, seen as a battle between the party's hard left and more moderate factions, will define Labour's voice in the negotiations to set the terms of Britain's European Union exit.
He accused some on the right of the party of acting in a way which could "split" Labour.
Labour Party members, affiliated trade union supporters and so-called registered supporters are able to vote although there are some key differences from the 2015 contest, which Corbyn won a year ago.
And the fee to register to vote has been increased from £3 a year ago to £25 this time around, which could also put off some of his backers.
He will join fellow MP Angela Eagle in trying to wrest the party leadership from the veteran socialist, who has refused to quit despite a major rebellion by his MPs.
There are suggestions that the parliamentary group could move to elect a new representative amongst their ranks, which means cutting their relation to the Labour Party.
Former Labour leader Ed Miliband brought in one-member-one-vote elections in 2014.
JUST 199 MPs voted for Theresa May to become the new Prime Minister.
A brick was thrown through the window of Angela Eagle's constituency office hours after she launched her leadership challenge.
The MP for Pontypridd, Owen Smith, is expected to announce his leadership bid on Wednesday.